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To: patroller who wrote (1101)	1/12/1998 4:21:00 AM
From: Asymmetric	Respond to of 2542

Patroller - I do not see Europe filling in for Asia. This will be born out over the coming year as US and other multinationals with exposure both to Asia and Europre release their earnings reports, IMHO, Peter.

To: patroller who wrote (1101)	1/15/1998 2:42:00 AM
From: Asymmetric	Read Replies (2) \| Respond to of 2542

Abbey Cohen's (of Goldman Sach's) read on the Asian situation. (excerpted from a longer summation) A.Cohen said that for most companies, Asia is statistical noise. Some companies will have greater impacts, but this will be the general impact. She cited that Asia is only 30% exports that are, in turn, only 13% of US GDP. According to Abby, Asia is serious but the US economy is solid and Canada, Mexico, and Europe are improving so it will only cause a small dent to profits. She also noted that we export 30% of our trade to Asia but import 48% of what we take in from other countries. Hence, Asia is a source of production rather than a source of demand. Goldman Sachs thinks that the markets overreacted to Asia, particularly in two areas: financial services and technology. In Fin Svcs: all the stocks are under pressure despite a very favorable inflation and interest rate scenario. She said that money center banks don't have a significant exposure to Asia. She stated that Citibank is puting in ATMs, but she said they are not issuin spec loans. On the contrary, 60% to 65% of non-performins loans are held by Japanese banks. Less than 5% of non-performing Asian loans are held by US banks. In financial services, the failure of some Asian institutions may even open up opportunities for US financial organizations (as she cited the US closing of Daiichi-forgive my spelling). In technology: She said approx 50% of tech customers are international. She said that some tech companies will get clobbered, but 1) on average 70% of the international business tech business is in Europe where demand is improving and 2) most of the Asian business is in Japan. Abby also favors small cap stocks. She said the risk premia for small cap stocks has increased steadily for 2 years and is up even more over 4 years ago. She believes small cap stocks now offer "extremely good value." Small stocks 1) offer attractive relative value, 2) will come into favor when investors see that the US is just fine, and 3) will gain interest with the increase in volatility as investors move to more active stock selection and sector rotation. Abby expects that by the end of 1998 the S+P will be at 1075, the Dow will be at 8700, and the Nasdaq will be at 1776 (that's her number). She said these should be easily achieved.